ROUGH DIAMONDS

ALROSA LOOKS TO RESTART ZIMBABWE’S AILING DIAMOND INDUSTRY

Things may be looking up for a country that about a decade ago appeared to be set to rewrite the world’s rough diamond map, but then saw its hopes dashed through corruption and bad planning. Alrosa, the world’s leading diamond producer in terms of volume, has said it plans to begin mining operations in Zimbabwe. The announcement was made during a visit by Zimbabwean President Emmerson Mnangagwa to Moscow.

Speaking at a press conference in the Russian capital, the Zimbabwean president said that a small window for foreign countries to participate in his country’s diamond industry.

“We are ready to share all our technologies and know-how with our colleagues, so that Zimbabwe can establish itself in the global diamond mining market,” Alrosa President Sergei Ivanov said during the press conference.

THE RISE AND FALL OF THE ZIMBABWEAN DIAMOND INDUSTRY

Mnangagwa, who was elected president of Zimbabwe in 2018, is on a desperate search for foreign investment, to help turn around the economy of the resource-rich but cash-strapped country.

His election as president came after a bloodless coup in Zimbabwe in November 2017, which brought about an end to the rile of the nonagenarian president, Robert Mugabe, and his wife Grace, as well the apprehension of other officials accused of corruption.

In 2012, when Zimbabwean rough diamond production reportedly stood at 12 million carats, it was estimated that the Chiadzwa diamond fields in the east of the country comprised about 13 percent of global rough diamond supply. The aggregate worth of its deposit was estimated to be between $60 billion and $70 billion.

Emmerson Mnangagwa, President of Zimbabwe, speaking during the press conference with Alrosa in Moscow.

But in 2014, rough diamond output from Zimbabwe’s mainly alluvial diamond fields had plummeted to about 4.7 million carats, meaning that over a two-year period production had fallen by 57.4 percent. It fell to 3.3 million carats in 2015 and to 2 million carats in 2016.

The Zimbabwe government was blamed for the situation, with the country’s Mines and Mining Development Minister, Walter Chidhakwa later admitting that a decision to expel private mining companies from Chiadzwa area had backfired. Legal action taken by certain of the companies prevented the government from executing its plan to control the area through a single state-owned venture, and 5,000 miners were left unemployed.

According to a statement issued by Alrosa at the start of the visit of Mnangagwa to Moscow, negotiations conducted in 2018 with the Zimbabwean government resulted in a decision to start operations in the country and to open an local subsidiary.

In February, Alrosa experts, including geologists and mining engineers, will arrive in Zimbabwe to launch operations.

Alrosa, which currently accounts for about 27 percent world rough diamond production, is involved in a number of southern African countries, including Botswana and Angola, where it own a 32.8 percent share in the giant Catoca diamond mine.